Are Medicare Advantage plans “Free”?

Navigating Medicare: Demystifying the Myths and Choices

Are Medicare Advantage plans really "free"? We know that when it comes to understanding Medicare, there's a lot of confusion out there. That's why we're here to shed some light on the matter and help you make informed decisions, especially during the Medicare enrollment season in October, November, and December each year.

Starting with the Basics

First and foremost, every person embarking on their Medicare journey begins by enrolling in Parts A and B with the government. While Part A coverage is generally premium-free for most, you may choose to enroll in Part B, which does come with a monthly premium. These premiums are a foundational aspect of Medicare.

The Six Levels of Part B Costs

Part B premiums vary based on income, and the Social Security Administration uses a two-year look-back to determine your monthly premiums. These additional costs are referred to as IRMAA (Income-Related Monthly Adjustment Amount). Those with higher incomes pay higher premiums for both Part B and Part D. See the charts below to determine what Medicare premium you might pay. Note that the costs on the far right are per person, per month.

Understanding IRMAA

If you disagree with your IRMAA assessment due to recent changes in your circumstances (recent retirement, for example), you have the option to request a redetermination. This process allows you to align your premium with your current income. Learn more about this process here.

Exploring Your Options

Once you've enrolled in Parts A and B, you have a choice to make regarding your coverage. There are two primary paths: Medicare Advantage Plans and Medigap insurance contracts. We've created informative YouTube videos that explain these options in detail, making it easier for you to decide. We encourage working with a Medicare-specialized insurance agent to help you decide what path to take. Remember that working with an agent costs you nothing.

Decoding Medicare Advantage

Medicare Advantage plans still require you to pay your Part B premiums to the government. However, when you choose a Medicare Advantage plan, you receive coverage for both Parts A and B through the plan provider, not directly from the government. It's essential to understand this distinction—your Part B premiums continue to be paid to the government, even with a Medicare Advantage plan. Medicare Advantage plans are very different than Medigap plans (Medicare supplements) so be sure to understand the differences as you first begin your Medicare insurance years.

The Illusion of "Free" Coverage

While some Medicare Advantage plans advertise "zero premium" options, it's vital to read the fine print. These plans may have out-of-pocket expenses, copayments, deductibles, and network restrictions. The truth is, they're not entirely "free." Insurance carriers offering Medicare Advantage plans receive payments from the government to provide Medicare-covered services to plan enrollees. Here's our video breaking down the essence of Medicare marketing.

The Medigap Alternative

Medigap contracts take a different approach. You continue paying your Medicare A/B premiums to the government and additionally pay an insurance carrier a premium for the Medigap contract. Medigap covers the expenses that Original Medicare (A/B) doesn't, like copays, coinsurance, and deductibles. You have the freedom to see any doctor or facility that accepts Medicare nationwide.

The Realities of Medicare Costs

In the world of healthcare, there's no such thing as a "free lunch." It's crucial to choose your Medicare path wisely, fully aware of the costs and coverage associated with your decision. We're here to guide you through this journey, providing clarity and expertise every step of the way.

At Giardini Medicare Team, we believe that knowledge is power. Medicare doesn't have to be a daunting puzzle; it can be a well-informed choice. Contact us today to navigate your Medicare options with confidence and clarity.